Arms sales made by the 100 largest companies in the sector increased by 1.9 percent in 2021, to $592 billion (about 561 billion euros at current exchange rates), and have now been rising for seven consecutive years, according to a report by the Stockholm International Peace Research Institute (SIPRI).
The sector continues to grow and, although it is still far from the data prior to the COVID-19 pandemic -when the average was around 3.7 percent-, it has managed to avoid the problems in the supply chains derived from the health emergency, and it remains to be seen how the war in Ukraine may affect the data for 2022.
North America is the only region where sales have declined, by eight-tenths, but SIPRI attributes this mainly to inflation. However, the top five companies on the list are still from the United States a and 40 U.S. firms amassed $299 billion in 2021.
In the case of Europe, it has 27 representatives on this list of one hundred companies and sales are up 4.2 percent to $123 billion. However, the report reflects a general improvement in shipbuilding and, on the contrary, a decline in the aerospace sector.
China is represented in this study with eight firms and $109 billion in sales, 6.3 percent more than in 2020, the result of a «wave of consolidation in the Chinese arms industry since the mid-2010s,» as SIPRI Military Spending and Arms Production Program researcher Xiao Liang, a researcher with SIPRI’s Military Spending and Arms Production Program, explains. China’s CSSC is already the world’s largest military shipbuilder, with arms sales of $11.1 billion, following the merger of two companies.
For the first time, a Taiwanese company appears among the hundred most powerful in the world: NCSIST, specialized in missiles and military electronics and with sales of $2 billion in 2021.
THE UKRAINE EFFECT The list incorporates six Russian companies, also with rises, specifically of 0.4 percent in global terms. Their arms sales amounted to $17.8 billion, although experts detect a general stagnation in the Russian industry.
SIPRI has already pointed out in its annual report that the effects of the invasion launched in February on the orders of Russian President Vladimir Putin are adding new obstacles to the supply chain for arms companies, mainly due to Russia’s importance as a supplier of raw materials used in arms production.
This variable is also threatening to hinder the attempts of the United States and Europe to reinforce their Armed Forces and replenish their reserves after the military aid provided to Ukraine during the last few months. Researcher Diego Lopes da Silva warns that, if the disruptions continue, «some of the main arms producers may take several years to meet the new demand created by the war in Ukraine».
